Town, an AI startup building assistants that help people work together, has raised $108 million in Series B funding at a $1 billion valuation. The round was co-led by Forerunner Ventures and Menlo Ventures, with participation from existing investors Andreessen Horowitz (a16z) and First Round Capital.
Other investors included Better Tomorrow Ventures, Precedent.vc, Scribble Ventures, Serena Ventures, and Sparked Ventures. Several angel investors also joined the round, including Brendan Foody, Josh Silverman, Romain Huet, Scott Belsky, Steve Bartel, Taro Fukuyama, and Varun Anand.
Town plans to build AI assistants that can do more than help individual employees. Its platform allows AI assistants to work with one another, share relevant information with permission, and help teams complete projects faster.
How Town’s AI Assistants Work
Many AI assistants help people handle personal tasks, such as booking travel or managing subscriptions. Town is focused on workplace tasks, where employees often need information and input from several colleagues before they can move forward.
The company’s platform gives each employee an AI assistant called a Townie. It connects to work tools such as email, documents, calendars, and other business systems. It learns about the employee’s projects, professional relationships, and communication style to help manage everyday work.
The key difference is that Townies can work with other Townies. They can ask questions, exchange permitted information, and hand work between employees instead of relying on people to coordinate every step manually.
Town says each assistant continues to work for its assigned user. It shares information according to that person’s permissions and seeks approval when necessary. Townies can also communicate with customers, business partners, and job candidates through email and text.
Why Town Is Targeting Teamwork
AI tools have made it easier for individual employees to complete certain tasks. However, many business processes still depend on information from other departments.
For example, a sales representative may need updated competitor information from the business operations team before preparing for a customer call. If that information is delayed, the sales process can slow down even when the representative has access to AI tools.
Town aims to reduce these delays by connecting employees through their AI assistants.
The platform also supports shared workflows. If a business operations team updates competitor information or changes a process, the relevant updates can be incorporated into the team’s workflow so employees’ Townies can use the latest information.
This approach could help companies reduce repetitive coordination work and make internal knowledge easier to use as their teams grow.
Business Security and AI Model Flexibility
Town says businesses retain ownership of the context their Townies build. The company aims to turn information spread across different systems into a shared business resource that can become more useful over time.
The platform uses models from multiple major AI providers and selects models based on the task. This approach is designed to reduce dependence on a single AI provider.
According to Town, connected customer data is not used to train AI models by default. The company also says it is SOC 2 Type II compliant and maintains a public data processing agreement.
These controls are important for businesses considering AI assistants that connect to employee communications, documents, calendars, and other internal systems.
Town’s Growth Since Launch
Town launched publicly in June 2026 alongside a $55 million Series A funding round. The company said it reached seven-figure annual recurring revenue (ARR) within weeks of launch.
Since July 2026, Town reports that its number of paying customers has grown fourfold, while the number of paying teams has increased ninefold.
These figures are company-reported and have not been independently verified in the information provided.
The new $108 million Series B gives Town additional funding to develop its product and expand its presence in the growing market for AI-powered workplace tools.
What Town’s Funding Means for the AI Startup Market
Town’s latest round highlights investor interest in AI products designed to handle business processes, not just answer questions or generate content.
As companies adopt more AI tools, coordinating work across employees, departments, and external partners remains a challenge. Town is betting that AI assistants will become more useful when they can work together while respecting individual permissions and company security requirements.
Its next challenge will be turning early customer growth into long-term adoption and demonstrating that coordinated AI assistants can deliver measurable improvements in productivity.
